The approval rate for commercial properties loan had rebounded.

According to the latest data released by Bank Negara Malaysia, the approval rate for commercial properties has started its uptrend.

In order for the prices of commercial properties to rise, some of the criteria need to be fulfilled.

1) A healthy economy. With the easing of the movement control order, Malaysia's economy is bouncing back very strongly. The opening of borders for foreign tourists is expected to commence very soon and this could be another booster to the demand for commercial spaces.

2) The financial status of businesses. From the quarter results released over the last few days, a strong recovery is seen in retailers and manufacturers. This also means businesses that are now equipped with a stronger balance sheet are more confident in expanding their business, hence creating demand for commercial properties.

3) Availability of liquidity. Since the property is a high-priced item where not many people could purchase it by paying cash, the willingness of banks to lend is very important. The Jan 2022 data released by Bank Negara on 28 Feb 2022 shows an inflection point in the banks' willingness to lend.

If you drive around any industrial park, you would be surprised that many empty plots of land are now built with factories and many vacant factories in the past are now being tenanted. You could even check out the Google Map to see the massive land clearing work being conducted in various industrial areas.

It may be too early to see a property market boom yet due to the market uncertainties. However, you could always start looking for companies with exposure to commercial properties to invest in.

You can check out the approval rate for other economic activities here: Malaysia Banking System Approval Rate